Experts from Rong Viet Securities say the market is favorable for short-term trading, but it is not the right time to go all-in.
In a strategic report published yesterday, the analysis team of Dragon Viet Securities Company (VDSC) stated that the stock market has recently shown more optimistic signals than in the previous period, thanks to the State Bank's moves to loosen monetary policy.
In May, 80% of stocks increased in price, many of which increased by one and a half times. The ceiling on short-term deposit interest rates continuously decreased, loosening the cautious psychology of domestic investors, helping liquidity skyrocket. The value of matched orders in the first week of June reached nearly 70,000 billion VND, a sharp increase compared to 46,000 billion VND a month ago.
According to statistics from Pyn Elite Fund, an investment fund based in Finland, the amount of margin (margin loans) at domestic securities companies has increased by 30-40% compared to the beginning of the year. This shows that individual investors are gradually regaining their excitement and accepting more risks to catch the price increase wave than in previous months. The fund also added that when the market gave many positive signals, individual investors "started to switch from bank deposits to securities".
However, according to VDSC, cash flow is showing significant differentiation. Small and medium-cap stocks are attracting a lot of money, while large-cap stocks are being "ignored" because investors assess that the internal factors of this group of businesses have not improved significantly.
Regarding the rapid increase of VN-Index in recent days, VDSC's analysis team assessed that the above movement is only short-term. This is favorable for T+ transactions (ie short-term buying and selling) when investors' psychology is increasingly excited. The group of stocks with high dividend yields and plans to pay in the end of Q2 and the first half of Q3 can also attract short-term investors' money.
However, the analysis team emphasized that this is not a good time for investors to go all in. Because the medium-term trend of the market - moving sideways in the range of 1,010-1,080 points - has not really changed due to the lack of support from the macro foundation and cash flow from foreign investors. The market will only enter an uptrend when there are clearer signals showing the penetration of support policies into the real estate and bond markets, leading to credit growth. In addition, other sufficient conditions to support the market's uptrend are the picture of global inflation gradually cooling down and domestic purchasing power recovering strongly.
"We do not expect the market to move too far in terms of scores this month," VDSC experts shared.
Sharing the same view with VDSC, the analysis team of Vietcombank Securities Company (VCBS) said that the market is "very positive" in the short term. Investors can take advantage of the increasing sessions to realize partial profits and can wait to buy back during correction sessions with stocks in leading sectors such as securities, banking, and real estate.
However, based on the analysis of the MACD (moving average convergence divergence) and RSI (relative strength index) indicators, VCBS experts mentioned the possibility that the market will face great selling pressure when the VN-Index reaches the price range of 1,115-1,120 points, which is 5-10 points higher than the current level, leading to losses if investors have a large proportion of stocks.
Against the backdrop of weak economic growth in the first quarter, the story of recovery from the profit trough will be of interest as businesses enter the final operating month of the second quarter. Therefore, the VDSC analysis team recommends that investors restructure their portfolios for medium and long-term goals, especially looking for large-cap stocks that have not fluctuated much in price.
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